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Car loan -v- other loan types

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  • 01-11-2007 9:18pm
    #1
    Random
    Closed Accounts Posts: 19,080 ✭✭✭✭


    I applied for a car loan off the credit union. What I'd like to know though, is what's the difference between getting a personal loan and using it to buy a car or getting a car loan and using it to buy a car?

    Thanks


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    #2
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Car loan is money lent for the purpose of buying a car and secured on said car.


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    #3
    Random
    Closed Accounts Posts: 19,080 ✭✭✭✭Random


    So if I default on the loan then they own the car? Assume this would be in the T&C if I go to sign?


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    #4
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    They will attempt to sell the car for as best the price they can and as fast as they can. However, if the price they get doesn't cover the outstanding debt, you are still liable for the remainder.

    Whatever about the T&C, it should always state very clearly in the credit agreement what items are being used as security along with a very clear warning, that if you fail to meet your repayments, you can lose said secured items.

    A car loan is along the same lines as a mortgage, just (a lot) simpler.

    If you go down the road of a personal loan, a bank might not lend you the amount you require. But if they do offer you an unsecured loan for the amount you require at a cheaper rate than a car loan, then of course you should go for it. (P.S. when applying for a personal loan, they will still ask you for what purpose you are borrowing the money - You will need to answer truthfully!)


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